Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Strategy. Read the original article for full details.
Major Lenders Cut Selected Mortgage Rates Amid Volatile Market
Nineteen lenders made changes to their mortgage rates this week, with most implementing selective rate cuts. The Moneyfacts Average New Two-Year Fixed Mortgage Rate fell marginally from 5.61% to 5.60%, while the average new five-year fixed rate edged down from 5.64% to 5.63%.
Several major lenders led the repricing, including HSBC, which cut selected fixed rates by up to 20 basis points, and Leeds Building Society, which reduced selected rates by up to 18 basis points. Nationwide Building Society, Nottingham Building Society, and Santander all cut selected fixed rates by up to 15 basis points, while Virgin Money reduced selected rates by up to 10 basis points.
Some lenders also improved pricing for higher loan-to-value (LTV) borrowers. Gen H reduced its fixed rates at 90% and 95% LTV by 15 basis points, and Newcastle Building Society launched a new five-year New Build Affordability Boost at 5.90% up to 95% LTV, with no fee and a free valuation.
However, not all changes were reductions. Skipton Building Society reduced selected fixed rates by up to 22 basis points but increased some LTI Booster rates by up to 7 basis points and raised its two-year LTI Booster tracker by 10 basis points. Vernon Building Society increased selected discounted variable rates by up to 43 basis points.
Product innovation continued, with HSBC increasing its maximum advances for high-value mortgages and launching new high-value fixed rates from 5.01% and two-year trackers from 4.65%. Perenna replaced its existing range with new five- and ten-year fixed products, including dedicated new-build deals. Kensington launched new two- and five-year fixes from 5.37% and 5.51% respectively, and Foundation refreshed some of its ranges, with rates starting from 5.99% for two years and 6.34% for five years.
Despite these reductions, volatility in the US bond market has pushed up the cost of borrowing for governments globally, including the UK. This has led to increased costs underpinning mortgage pricing, which may put upward pressure on fixed mortgage rates in the coming weeks.
Source: Mortgage Strategy